Massive FCA cases dealing with billions of dollars stolen from state pension funds may lay ahead. Federal prosecutors have already collected over $1.6 billion in FCA settlements from Bank of America, Citigroup, Deutsche Bank and Flagstar based on the defrauding of federal home insurance programs. Billions more may yet be collected by state pension funds ripped off when they invested in mortgage-backed securities sold by companies who knew the ratings were rotten.
Notes Eric Havian of Phillips & Cohen, "If issuers knew the ratings were false and they sold securities to state pension funds, they would absolutely be liable. That's an easy FCA case."
Bottom line: states without False Claims Act legislation, and states that have Medicaid-only False Claims Act legislation, stand to lose hundreds of millions of dollars unless they move now to incentivize whistleblowers and mandate treble damages.